Malaysia deal a bridge to Asia for Akari

The signing of a $1m contract with a Malaysian university has provided Cork company, Akari Software with a significant breakthrough in its bid to develop sales internationally.

One of the first companies in Europe to develop curriculum management software for third-level institutions, Akari is also negotiating with a university in the Middle East, as well as with two third-level colleges in the UK. Company chief technical officer and co-founder Páraic Hegarty expects these three contracts to be signed within weeks.

Set up in 2011 by Mr Hegarty and CEO Eoghan O’Leary, the company’s software is used in Cork Institute of Technology, DCU, NUI Galway, National College of Ireland, St Patrick’s College Drumcondra as well as institutes of technology in Blanchardstown, Carlow, Dundalk and Tallaght.

Based in Little Island, where it employs a staff of 10, together with a UK consultant and Bahrain-based director, Akari has been supported by Enterprise Ireland and the Department of Foreign Affairs and Trade in its efforts to develop global markets over the last two years.

“The UK market has proved more difficult to crack than we anticipated, but we are now close to getting a foothold there and see huge potential for growth in Southeast Asia and the Middle East,’’ says Mr Hegarty.

The new contract signed earlier this month is with UiTM in Malaysia, a university with 17,000 staff, 189,000 students and more than 30 campuses. “This is our largest contract to date,’’ said Mr Hegarty, noting that the Southeast Asia market had grown hugely in recent years and that the education budget in Malaysia had increased to over €4.3bn annually.

“Part of the plan now is to establish a partnership arrangement in both Southeast Asia and the Middle East,” he said. The Middle East is seeing dramatic growth in education capacity, driven by booming population growth and burgeoning demand for tertiary education for women,’’ reveals Mr Hegarty, noting that Saudi Arabia had doubled spending on education to $54m in 2012.

When the company launched on the market with a suite of curriculum management software product, it had both the advantage and the disadvantage of being one of the first movers in this space. The advantage was lack of competition but the disadvantage was that universities hadn’t come around to appreciating the need for this type of product.

“Now there are two or three companies operating in this area and the concept of curriculum software management has become widely accepted,’’ says Mr Hegarty, explaining that the company had been adding new product and improving the functionally of its software.

Following the signing of the Malaysian contract, Akari will work with UiTM on developing new software products for managing exams and scheduling lectures.

While the company has been actively targeting markets in the UK and Europe for the last two years, developments in Southeast Asia and the Middle East came about by chance, chances Akari is now intent on seizing.

In early 2013, the company received an inquiry on its website from UiTM. It provided information, received a visit from a representative of the university and eventually, Mr O’Leary visited the campus in Shah Alam in November. “We received support from Enterprise Ireland and the Irish Ambassador to Malaysia. In May this year, we got final approval from the Ministry of Finance there, and signed the contract in June.”

The contract being negotiated in the Middle East came about because a lecturer there spent some time in Ireland where he used the company software and wanted to keep using it. Akari has been in negotiations with the university since last year and now has a sales director located in Bahrain.

In September last year, the company signed a partnership agreement with Ellucian, which supplies third-level institutions with Student Information Systems. Mr Hegarty says this is also generating new leads for Akari in both the UK and Europe.

The company expects to sign deals with two medium-sized UK universities in July.

While much of the focus now is on Malaysia and the Middle East, Akari has long-term plans for the US. In recent months, it received an inquiry from the Massachusetts Institute of Technology, together with other inquiries from Australia, New Zealand and South Africa.

Since it was set up in 2006, Akari has raised €600,000 in funding, half of which came from Enterprise Ireland which identified the company as a High-Potential Start-Up in 2011. Now it is making plans for a more significant fundraising round. Meanwhile, Akari is recruiting three new IT staff and expects the number to grow to 18 by the end of the year. Targeting a turnover of over €1m this year, the company plans to employ seven more staff in 2015.